Employee Resignation is Not a Shield from Employer Liability

Oftentimes, newer employers believe that they are clear from liability because “they never fired anyone.” Businesses may believe they are shielded from litigation because they have never fired anyone- rather, people leave if they don’t like their job. This is a misnomer and one that can get employers into some trouble…

It is important for employers to know this: Termination is NOT the only trigger for litigation under Title VII.

Let’s do a quick refresher: Title VII is the law that prohibits employers from taking adverse employment actions against their employees because of their (1) race, (2) sex, (3) religion, and (4) country of origin. In order to bring a cause of action under Title VII for discrimination, an employee must demonstrate four elements:

  1. The employee is a member of a protected class;
  2. The employee is qualified for their job;
  3. They suffered an ADVERSE EMPLOYMENT ACTION at the hands of their employer; and
  4. The circumstances of the adverse employment action give rise to an inference of discrimination.

EMPLOYERS TAKE NOTE: The law does not require someone to be fired.

What is an Adverse Employment Action? An adverse employment action is any significant change in an employee’s employment. The following are examples of adverse employment actions:

  • Failing to Promote
  • Reduction in Pay
  • Reassignment with significantly different responsibilities
  • An employment decision affecting benefits

Remember Constructive Termination. It is also important for employers to remember that courts view constructive discharge as synonymous with termination. Constructive Discharge is when the work environment becomes “so difficult or unpleasant that a reasonable person…would have felt compelled to resign.” So, if a working environment becomes so arduous, unpleasant and unbearable and an employee is forced to quit, that has the same effect as a termination. In that situation, the employer cannot rely on the fact that the employee resigned. There would be a strong argument that the employee had no choice and was forced to resign. Thus, for all intents and purposes, they were fired.

Employers should consult with counsel whenever they have issues related to termination of employees.

Contributing Advisors